Die neue Commerzbank. Merrill Lynch Banking and Insurance CEO Conference. Martin Blessing CEO London 30 September / 1 October 2009

Transcription

1 Die neue Commerzbank Merrill Lynch Banking and Insurance CEO Conference Martin Blessing CEO London 3 September / 1 October 29

2 Brief review: H Successful de-risking: strong reduction in balance sheet, risk weighted assets and ABS-Portfolio 2. Asset disposals in accordance with Roadmap PC and MSB with positive operating profit despite challenging markets 4. Full year funding plan entirely completed by mid year 5. Dresdner Bank integration well on track Martin Blessing CEO London 3 September / 1 October 29 1

3 Successful de-risking Balance sheet in bn Risk weighted assets in bn -13% -12% , Total assets Dec 8 * Eurohypo Derivatives Client Business Repos & Others Total assets June 9 RWA Dec 8 * Volume FX & others RWA June 9 * 28 pro-forma Martin Blessing CEO London 3 September / 1 October 29 2

4 Tier 1 Tier 1 ratio Dec '8 pro-forma Mar'9 Jun'9 Confirmation of high capital ratios - Including silent participation and capital increase from SoFFin - Positive effect from nondeducting of negative revaluation reserve according to industry standards in Europe (e.g. France, UK, Netherlands) RWA decreased due to de-risking of total assets Mar '9 Jun'9 Risk weighted assets ( bn) Revaluation reserves ( m) -2,852-2,543 Tier I capital ( m) 21,346 33,41 Revaluation reserve affected by - Sale of financial investments (i.e. Linde, ThyssenKrupp) - Spread tightening Martin Blessing CEO London 3 September / 1 October 29 3

5 Operating performance affected by challenging market conditions 1 before LLP Q2 29 vs Q2 28* vs Q1 29 Revenues 1 in m 3, Operating profit in m Clean operating profit in m Net profit in m Operating ROE in % -3.% +.6ppt +7.ppt Clean operating ROE in % 1.4% -23.4ppt -9.5ppt Net interest income improved, net commission income bottoming out Trading income significantly up Loan loss provisions remain on high levels due to the economic crisis Operating expenses affected by integration costs and non-bank related external charges Clean operating profit of 93m reflects weak economic conditions and integration costs * pro-forma Martin Blessing CEO London 3 September / 1 October 29 4

6 Our "Roadmap 212" The challenge we face Severe financial and economic crisis and integration of Dresdner Bank Our response Strategic three-point program entitled "Roadmap 212" Our objective "Hausbank" for private and corporate customers in Germany Our strategy We will focus: We will optimize: We will downsize: Create a "client-centric bank" with profitable core business areas Scale down our credit business secured by mortgages Maximize value through active management of downsize-portfolios Martin Blessing CEO London 3 September / 1 October 29 5

7 Overview of our new strategy Focus Creation of a "client-centric bank" with profitable core business areas (Private Customers, Mittelstandsbank and CEE) Ability to generate stable earnings by focussing on core business Quick integration of Dresdner Bank and cost leadership Substantial downsizing of investment banking and enhanced client-orientation Concentrate on client-oriented services Provide German-focused investment banking products and services with European footprint Optimization Downsizing Redimensioning our asset-based credit business (Real Estate and Public Finance) Realign market leader Eurohypo Retain healthy core business of CRE Continue pursuit of downsizing strategy in public finance Value maximization by active management of downsize-portfolios Ring-fence structured credit products, exotic credit and "credit flow" (proprietary credit trading) Actively manage portfolios in the Portfolio Restructuring Unit (PRU) Martin Blessing CEO London 3 September / 1 October 29 6

8 Private Customers: Quantum step in market presence More than 11 m private customers in Germany Customers (in m) Branch network: Close to our customers Number of branches Postbank 14.1 New Commerzbank Target: ~ 1,2 branches 1,54 New Commerzbank >11~ Deutsche Bank 986 Deutsche Bank* ING Diba HVB ~1 Postbank HVB Market leader in investment business Customer assets (in bn) Top 3 position in credit business Credit volumes (in bn) New Commerzbank 23 Deutsche Bank 91 Deutsche Bank 214 Postbank 77 HVB** 97 New Commerzbank*** 66 Postbank Retail 91 ING Diba 45 ING Diba 75 HVB 44 Source: Annual Report 28 * German customer base, total global customer base: 14.6m ** Estimate *** Excluding retail portfolio Eurohypo Martin Blessing CEO London 3 September / 1 October 29 7

9 Mittelstandsbank: First choice for small and mid-sized SMEs SMEs (Turnover of m) Mid-sized SMEs (Turnover of m) Large corporate clients (Turnover of > 25m) Market share (gross income) CoBa (old) CoBa (new) CoBa (old) CoBa (new) CoBa (old) CoBa (new) ~4% ~6% ~11% ~18-2% ~7% ~12% Customer relationships 51% -6% 43% -19% 7% -48% 1% 1% 55% 76% 78% 1% CoBa old DreBa old Double clients CoBa new CoBa old DreBa old Double clients CoBa new CoBa old DreBa old Double clients CoBa new Expansion of customer relationships to increase the market share in this diversified segment Selective expansion of customer relationships and increase in share of wallet Already very high customer penetration; increase in share of wallet Martin Blessing CEO London 3 September / 1 October 29 8

10 Central and Eastern Europe (CEE): Portfolio optimization Commerzbank s Strategic Position One of the leading international banks in Central & Eastern Europe with more than 3.4 m customers Differentiated business model focusing on Commerzbank s key competencies corporate and retail banking Concentrating operations on most attractive markets Profitability Drivers Strategic Goals Mitigating P&L-risks Risk reduction and portfolio optimization & ongoing efficiency programs for all business units Optimization of product portfolio and development of new business / revenue sources Focus on profitable core business Increasing profitability in corporate banking, focused growth in retail banking Reducing risk costs, strict cost management and development of new revenue streams Further development of business models, e.g. business mix, operational excellence Martin Blessing CEO London 3 September / 1 October 29 9

11 Corporates & Markets: Client-focused investment banking house C&M Equity Markets Commodities (EMC) Top 3 European Equity Derivatives provider/#1 German Equity house Integrated Commodities business Leverage much larger retail/ corporate client base Fixed Income & Currencies (FIC) Top counterparty for risk management solutions (IR/FX) - particularly in Corporate Germany Client-centric business model: leverage on Germany as core and focused international sales forces Corporate Finance (CF) Top German Corporate Finance House Focus on financing and advisory of German large caps and multinationals Corporate Finance advisory and execution for MSB Client-Relationship Management (CRM) A provider of the full banking universe of services for the top 1 German Corporates and leading international Insurance companies Research Martin Blessing CEO London 3 September / 1 October 29 1

12 Asset Based Finance (ABF): Value recovery and reduction of RWA Goal for 212 EUROHYPO (CRE) Downsizing of portfolio to 6 bn by 212 Reduction from more than 3 markets today to 1 markets Target clients in Germany are professional real estate investors and developers from 15 m financing volume upwards Strong redimensioning and increase in profitability/efficiency PUBLIC FINANCE Downsizing of portfolio to maximum 1 bn by 21; decrease of new business Funding ensured by ability of using assets as cover fund; refinancing at matching maturities SHIPPING Reduction in new business Martin Blessing CEO London 3 September / 1 October 29 11

13 Portfolio Restructuring Unit (PRU): Assets earmarked for downsizing Goal Comprehensive spin-off of all ABS-related and structured credit portfolios Additionally all credit run-down portfolios from C&M (focus on core activities) Systematic reduction of assets to ease pressure on P&L, separated from core operating business No spin-off of individual assets from core business PRU Structured credit (ABS, MBS, CDOs, Conduits) Structured, exotic credit derivatives (Bonds, loans trading, indices, other) "Credit Flow": loan trading Not included SLABS (Government wrapped student loans) Leveraged Acquisition Financing Client driven Conduits Other positions Martin Blessing CEO London 3 September / 1 October 29 12

14 Integration roadmap and milestones Phase I: Integration preparation Phase II: Preparation for integration implementation Phase III: Integration implementation Blueprint New Commerzbank Business model/strategy Organization Core processes Synergies Business Case Stabilization measures Plannning of integration Works council negotiations Implementation human resources management Preparation IT Detailed planning of implemenation Overall optimization of locations De-risking investment banking Training/schooling Change process Implementation of human resources management IT-implementation Adoption of target organisation and target processes Implementation synergy measures Conclusion balance sheet reduction Training/schooling Change process August 31, 28 Announcement of Dresdner Bank acquisition Januar 31, 29 Finalization blueprint March 3, 29 Conclusion social plan/ reconciliation of interests (Head Office) May 11, 29 Merger 2. Juli 29 Conclusion social plan/ reconciliation of interests (regional branches) Q4 21 IT migration Martin Blessing CEO London 3 September / 1 October 29 13

15 "Roadmap 212" and objectives for the new Commerzbank FOCUS OPTIMIZATION DOWNSIZING The new Commerzbank Mittelstandsbank Private Customers Corporates & Markets CEE Other and consolidation Real Estate and Public Finance Structured credit products Exotic credit "Credit Flow" (proprietary credit trading) 212e Total Op. profit in m >1,5 >35 >4, Pre tax RoE* in % >3 >2 After tax RoE in % RWA in bn <29 CIR in % <6 * Indicative derivation on the basis of a model for future capital management; calculation of group RoE on the basis of the sum of segment capital (not on the basis of shareholders' capital) Martin Blessing CEO London 3 September / 1 October 29 14

16 Our targets (1/3) Targets for 29 achieved to date Targets for 29 to 211 Longer-term targets Completion of Dresdner Bank acquisition Reconciliation of interests and social compensation plan for headquarters in Frankfurt Recapitalization of the new Commerzbank (SoFFin) New strategic orientation: "Roadmap 212" Integration process on time Total unused SoFFin guarantees of 1bn returned ahead of time Martin Blessing CEO London 3 September / 1 October 29 15

17 Our targets (2/3) Targets for 29 achieved to date Targets for 29 to 211 Longer-term targets Reduction in operating expenses under 8 bn End-21 Brand integration completed (Dreba and CoBa) End-21 Return to profitability (break-even before SoFFin) 211 at the latest Martin Blessing CEO London 3 September / 1 October 29 16

18 Our targets (3/3) Targets for 29 achieved to date Targets for 29 to 211 Longer-term targets > 4 bn in sustainable operating profit 212 RoE target after tax 12% 212 Reduction of RWAs to < 29 bn (before sale of Eurohypo) Planned reduction of silent participations subject to normalized market conditions Martin Blessing CEO London 3 September / 1 October 29 17

19 Outlook 1. Sentiment improved, but both institutional and private clients are still transacting less securities 2. PRU with the right set up, shareholder-minded approach in reducing assets - De-risking continues 3. Integration of Dresdner Bank continues to be on high priority 4. Cautious outlook due to the fragile market environment, but solid start in H2 5. New segment reporting starting July 1st, restated figures will be delivered ahead Q3 disclosure Martin Blessing CEO London 3 September / 1 October 29 18

20 Appendix 1: Q2 29 Martin Blessing CEO London 3 September / 1 October 29 19

21 Q2 with reduced negative market effects Income from financial investments Trading profit Loan Loss provisions Other result Total One-offs in m ABS incl. RMBS Others Sale of Holdings Total PBC/MSB CEE C&M CRE O&C Total Martin Blessing CEO London 3 September / 1 October 29 2

22 Loan loss provisions and exposure at default in 1st Half 29 Commerzbank EaD in bn LLP in m LLP ratio * in bp of EaD Private Customers Mittelstandsbank Corporates & Markets Central and Eastern Europe Commercial Real Estate Others and consolidation Total , First effects of negative market environment becoming noticeable Increased restructurings and expected credit defaults Reduction in burdens due to successful restructurings Clear reduction expected for H2 Trend reversal can not be foreseen shortterm Cluster risks due to difficult situation in international markets Risk provisions for 29 is to be expected on 28 levels In terms of impairment charges arising from available-for-sale holdings and defaults in the trading book, the current assumption for reaching the peak for the New Commerzbank was in 28. A reduction for this area is expected in 29 under our realistic-case scenario. * annualized Martin Blessing CEO London 3 September / 1 October 29 21

23 First cost synergies kicking in Adjusted cost base in m Staff (FTE) end of period -5.6% -5.4% * 78 39* 2,81 2,273 2,146 2,263 59,358 58,435 56,133 Costs Q1 As reported First 12 days Dresdner Bank Adjusted cost base Q1 Adjusted cost base Q2 * Integration expenses not recognized as restructuring costs Deposit insurance scheme and Mutual pension assurance association Costs Q2 As reported Martin Blessing CEO London 3 September / 1 October 29 22

24 Operating profit & Net profit Operating profit & Net profit in m ,447-1,522-4, Operating profit in Q2 was minus 21m - One-off effects of - 294m Pre-tax profit of minus 487m affected by restructuring charges ( 216m) and goodwill impairment ( 7m, CRE) Net profit is hit by tax charges due to - No loss activation in US, UK and Spain - Impairment on DTA of Eurohypo New York ( 41m) -5,45 Q1 Q2 Q3 Q4 Q1** 28 * 29 Q2 Operating profit Net profit attributable to Commerzbank shareholders and SoFFin * 28 pro-forma ** first 12 days result of Dresdner Bank is not accounted but included in PPA Martin Blessing CEO London 3 September / 1 October 29 23

25 Balance Sheet Leverage Ratio (in m) pro-forma Equity 21,122 29,147 Total Assets 1,45, ,815 Derivatives netting -1,78-12,854 Trading assets / liabilities netting -256,523-29,594 Deferred taxes netting -3, -3,676 Other assets / liabilities netting -8,499-7,31 Total Adjusted Assets 766, ,66 Leverage Ratio Martin Blessing CEO London 3 September / 1 October 29 24

26 Client deposits remain on high level - funding plan already completed Deposit volume 1) in bn Funding plan in bn +9% 22 Plan: Approx. 2 bn Done: 22 bn 185 Approx. 1.5 bn Senior unsecured 13.3 bn Approx. 6 bn Up to 3 bn Mortgage Pfandbriefe Public sector Pfandbriefe 7.2 bn 1.5 bn Jun`8 * Jun`9 Retail deposit volume growth offset by reduction in overnight deposits from foreign corporate customers in Q2 Funding volume of 22bn by September, predominantly unsecured issues 1) Only retail and corporate customers Martin Blessing CEO London 3 September / 1 October 29 25

27 Germany: Strong second half of the year ahead, but slow-down in 21 Forecast for 29/21 The most severe recession of the last 6 years is over, in the 2nd quarter real GDP rose.3% q-o-q. Foreign demand is recovering significantly, and firms has started to rebuild their inventories. Additional impulses come from the fiscal packages, especially the scrapping incentive for old cars. We will see strong growth in H2. In 21, there will be significant impulses from ECB s strong interest rate cuts, which will take effect starting around the turn of the year with the usual lag of 4 quarters (see right-hand-side chart). Nevertheless, the recovery will loose some momentum, since in many industrial countries the correction of the exaggerations of the past (boom in the construction sector, strong increase of indebtedness of firms and private households) will have to go on. This will slow down German exports to these countries. Germany: Stabilization after the slump Real GDP, in billion Euro and change on quarter in percent 2, 1,5 1,,5, -,5-1, -1,5-2, -2,5-3, -3,5 24 Change qoq (LS) in billion Euro Germany: Monetary policy impacts 21 Investment in machinery and equipment, real, change year-on-year, 3 quarter averages Real interest rate: 3-month EURIBOR less core inflation (ex food, energy and taxes), +4 quarters Investment (lhs) Real Interest Rate (inverted scale, rhs) Source: Commerzbank Economic Research Martin Blessing CEO London 3 September / 1 October 29 26

28 Appendix 2: Segmental reporting Martin Blessing CEO London 3 September / 1 October 29 27

29 Commerzbank Group in m Q1 28 Q2 28 H1 28 Q3 28 Q4 28 Q1 29 Q2 29 H1 29 Net interest income 1,491 1,762 3,253 1,722 2,245 1,692 1,838 3,53 Provision for possible loan losses , ,837 Net interest income after provisioning 1,3 1,274 2, ,693 Net commission income 1,18 1,25 2,385 1,227 1, ,797 Trading profit , Net investment income Other result Revenue b efore LLP 2,936 2,774 5,71 1, ,334 3,55 5,389 Revenue after LLP 2,745 2,286 5,31 1,44-2,398 1,49 2,62 3,552 Operating expenses 2,275 2,417 4,692 2,491 1,937 2,81 2,263 4,344 Operating profit ,447-4, Impairments of goodw ill Restructuring expenses Pre-tax profit ,447-4, ,367 Investors Capital 14,477 14,67 14,542 14,863 15,125 23,671 26,799 25,235 Operating return on equity (%) 13.% -3.6% 4.7% -38.9% - -1.% -3.% -6.3% Cost/income ratio in operating business (%) 77.5% 87.1% 82.2% 128.3% % 74.1% 8.6% Return on equity of pre-tax profit (%) 12.3% -3.6% 4.3% -38.9% % -7.3% -1.8% Martin Blessing CEO London 3 September / 1 October 29 28

30 Solid core client business, CRE and CEE burdened by increased LLP Operating profit¹, in m Private Customers Mittelstandsbank Central & Eastern Europe Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q Q1 Q2 Q3 Q4 Q1 Q Corporates & Markets Commercial Real Estate Others & Consolidation ,837-4,79-1, Q1 Q2 Q3 Q4 Q1 Q2-176 Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4 Q1 Q Adjusted operating profit ¹ 28 pro-forma All operating segments on a full period base, Q1/9-12-day-effect will be adjusted in O&C Martin Blessing CEO London 3 September / 1 October 29 29

31 Private Customers with stable revenues and constant customer growth Operating profit ¹ in m Q1 Q2 Q3 Q4 Q1 Q Main P&L items ¹ in m Q2`8 Q1`9 Q2`9 H1`8 H1`9 Net interest income ,219 1,2 Risk provisioning Commission income ,45 1,38 Trading profit Net investment income Operating expenses 1, ,4 1,95 Operating profit Q2`8 Q2`9 H1`8 H1`9 Ø equity ( m) 3,15 2,584 3,41 2,623 Op. RoE* (%) CIR (%) Ø Q2 equity allocation within Group 11.2% NII stable despite low interest rate level Increased risk provisioning reflects market environment Commission income improved vs. Q1 level following slightly higher market activities Operating expenses under control 73. new clients *annualized Adjusted operating profit ¹ 28 pro-forma All operating segments on a full period base, Q1/9-12-day-effect will be adjusted in O&C Martin Blessing CEO London 3 September / 1 October 29 3

32 Private Customers in m Q1 28 Q2 28 H1 28 Q3 28 Q4 28 Q1 29 Q2 29 H1 29 Net interest income , ,2 Provision for possible loan losses Net interest income after provisioning , ,39 Net commission income , ,38 Trading profit Net investment income Other result Revenue b efore LLP 1,317 1,293 2,61 1,211 1,121 1,98 1,111 2,29 Revenue after LLP 1,272 1,238 2,51 1,154 1,66 1,33 1,15 2,48 Operating expenses 1,3 1,37 2,4 1, ,95 Operating profit Impairments of goodw ill Restructuring expenses Pre-tax profit Average equity tied up 3,68 3,15 3,41 2,975 2,87 2,661 2,584 2,623 Operating return on equity (%) 35.1% 26.5% 3.8% 2.8% 17.5% 7.2% 7.7% 7.5% Cost/income ratio in operating business (%) 76.2% 8.2% 78.2% 82.6% 84.% 89.7% 86.9% 88.3% Return on equity of pre-tax profit (%) 35.9% 26.4% 31.2% 21.2% 19.5% -.5% 1.1%.3% Martin Blessing CEO London 3 September / 1 October 29 31

33 Mittelstandsbank with stable results in operating business also in Q2 Operating profit ¹ in m Q1 Q2 Q3 Q4 Q1 Q Main P&L items ¹ in m Q2`8 Q1`9 Q2`9 H1`8 H1`9 Net interest income ,89 Risk provisioning Commission income Trading profit Net investment income Operating expenses Operating profit Ø Q2 equity allocation within Group Q2`8 Q2`9 H1`8 H1`9 Ø equity ( m) 4,696 4,697 4,794 4,817 Op. RoE* (%) CIR (%) C 2.9% NII remains on high level, mainly driven by improved margins in lending business Risk provisions more than 2x higher q-o-q due to economic environment Operating expenses maintained despite one-off items *annualized Adjusted operating profit ¹ 28 pro-forma All operating segments on a full period base, Q1/9-12-day-effect will be adjusted in O&C Martin Blessing CEO London 3 September / 1 October 29 32

34 Mittelstandsbank in m Q1 28 Q2 28 H1 28 Q3 28 Q4 28 Q1 29 Q2 29 H1 29 Net interest income ,89 Provision for possible loan losses Net interest income after provisioning Net commission income Trading profit Net investment income Other result Revenue b efore LLP , ,447 Revenue after LLP , ,138 Operating expenses Operating profit Impairments of goodw ill Restructuring expenses Pre-tax profit Average equity tied up 4,892 4,696 4,794 5,252 4,995 4,936 4,697 4,817 Operating return on equity (%) 29.8% 3.7% 3.2% 25.1% 4.2% 26.3% 13.3% 2.% Cost/income ratio in operating business (%) 47.% 45.% 46.% 43.7% 35.3% 43.8% 47.% 45.4% Return on equity of pre-tax profit (%) 29.8% 3.7% 3.2% 25.1% 4.3% 25.% 12.6% 18.9% Martin Blessing CEO London 3 September / 1 October 29 33

35 Central & Eastern Europe again affected by strong increase in risk provisions Operating profit ¹ in m Q1 Q2 Q3 Q4 Q1 Q Main P&L items ¹ in m Q2`8 Q1`9 Q2`9 H1`8 H1`9 Net interest income Risk provisioning Commission income Trading profit Net investment income Operating expenses Operating profit Ø Q2 equity allocation within Group Q2`8 Q2`9 H1`8 H1`9 Ø equity ( m) 1,879 1,624 1,716 1,655 Op. RoE* (%) CIR (%) % NII keeps high level Renewed increase in risk provisions by 17% q-o-q partially due to settlement in FX products burdened results Operating expenses flat q-o-q due to effective cost containment program, reduced by 19% y-o-y Number of customers at BRE Bank and Bank Forum rises to nearly 3.5 million *annualized Adjusted operating profit ¹ 28 pro-forma All operating segments on a full period base, Q1/9-12-day-effect will be adjusted in O&C Martin Blessing CEO London 3 September / 1 October 29 34

36 Central and Eastern Europe in m Q1 28 Q2 28 H1 28 Q3 28 Q4 28 Q1 29 Q2 29 H1 29 Net interest income Provision for possible loan losses Net interest income after provisioning Net commission income Trading profit Net investment income Other result Revenue b efore LLP Revenue after LLP Operating expenses Operating profit Impairments of goodw ill Restructuring expenses Pre-tax profit Average equity tied up 1,553 1,879 1,716 1,998 1,894 1,686 1,624 1,655 Operating return on equity (%) 33.2% 21.1% 26.6% 14.4% 4.9% -13.8% -2.4% -17.% Cost/income ratio in operating business (%) 42.1% 53.9% 48.2% 5.5% 62.5% 5.% 49.4% 49.7% Return on equity of pre-tax profit (%) 33.2% 21.1% 26.6% 14.4% 4.9% -13.8% -2.4% -17.% Martin Blessing CEO London 3 September / 1 October 29 35

37 Corporates & Markets shows strong progress with improved results and reduction of risks Operating profit ¹ in m , , Q1 Q2 Q3 Q4 Q1 Q Main P&L items ¹ in m Q2`8 Q1`9 Q2`9 H1`8 H1`9 Net interest income Risk provisioning Commission income Trading profit Net investment income Operating expenses ,423 1,19 Operating profit , ,463-1,375 Ø Q2 equity allocation within Group *annualized Q2`8 Q2`9 H1`8 H1`9 Ø equity ( m) 6,765 6,937 7,7 7,141 Op. RoE* (%) CIR (%) n/a n/a n/a n/a 31.% Q2 29 continued to be burdened by de-risking efforts and impairments in the PRU but ongoing business with solid results Strong underlying performance leading to a significantly reduced operating loss of - 231m Significantly lower LLPs than in Q1 due to less burdens related to structured loan commitments Strong recovery of trading profit driven by positive underlying performance and lower impairments Reduced operating expenses due to headcount reduction Adjusted operating profit ¹ 28 pro-forma All operating segments on a full period base, Q1/9-12-day-effect will be adjusted in O&C Martin Blessing CEO London 3 September / 1 October 29 36

38 Corporates & Markets in m Q1 28 Q2 28 H1 28 Q3 28 Q4 28 Q1 29 Q2 29 H1 29 Net interest income Provision for possible loan losses , Net interest income after provisioning Net commission income Trading profit , Net investment income Other result Revenue b efore LLP , Revenue after LLP ,64-4, Operating expenses , ,19 Operating profit ,463-1,837-4,79-1, ,375 Impairments of goodw ill 27 Restructuring expenses Pre-tax profit ,482-1,836-4,815-1, ,53 Average equity tied up 7,249 6,765 7,7 6,667 8,528 7,345 6,937 7,141 Operating return on equity (%) -43.% -4.4% -41.8% % -13.3% -38.5% Cost/income ratio in operating business (%) n/a n/a n/a n/a n/a n/a n/a n/a Return on equity of pre-tax profit (%) -44.1% -4.3% -42.3% % -17.% -42.1% Martin Blessing CEO London 3 September / 1 October 29 37

39 CRE continues to be burdened by difficult market environment Operating profit ¹ in m Q1 Q2 Q3 Q4 Q1 Q Main P&L items ¹ in m Q2`8 Q1`9 Q2`9 H1`8 H1`9 Net interest income Risk provisioning Commission income Trading profit Net investment income Operating expenses Operating profit Ø Q2 equity allocation within Group Q2`8 Q2`9 H1`8 H1`9 Ø equity ( m) 5,129 5,778 5,1 5,994 Op. RoE* (%) CIR (%) % NII improved due to higher margins in prolongations and unwinding effects ( 3m) Strong increase in risk provisions q-o-q due to write-downs in the US and Spain Commission income clearly down as new business declines Investment income less negatively affected due to reduced impairments on RMBS *annualized Adjusted operating profit ¹ 28 pro-forma All operating segments on a full period base, Q1/9-12-day-effect will be adjusted in O&C Martin Blessing CEO London 3 September / 1 October 29 38

40 Commercial Real Estate in m Q1 28 Q2 28 H1 28 Q3 28 Q4 28 Q1 29 Q2 29 H1 29 Net interest income Provision for possible loan losses Net interest income after provisioning Net commission income Trading profit Net investment income Other result Revenue b efore LLP Revenue after LLP Operating expenses Operating profit Impairments of goodw ill 7 7 Restructuring expenses Pre-tax profit Average equity tied up 5,72 5,129 5,1 5,494 5,728 6,21 5,778 5,994 Operating return on equity (%) 9.4% -12.5% -1.6%.7% -1.3% -3.4% -11.8% -7.5% Cost/income ratio in operating business (%) 42.% 48.8% 45.3% 56.9% 68.8% 48.1% 49.5% 48.8% Return on equity of pre-tax profit (%) 9.4% -12.5% -1.6%.7% -1.3% -3.4% -19.7% -11.2% Martin Blessing CEO London 3 September / 1 October 29 39

41 Others & Consolidation Operating profit ¹ in m Q1 Q2 Q3 Q4 Q1 Q Main P&L items ¹ in m Q2`8 Q1`9 Q2`9 H1`8 H1`9 Net interest income Risk provisioning Commission income Trading profit Net investment income Operating expenses Operating profit Q1 9 includes first-12-days-effect of Dresdner Bank consolidation Sale of Holdings (Linde, ThyssenKrupp and Lufthansa) Operating expenses affected by integration costs ( 39 m) Adjusted operating profit ¹ 28 pro-forma All operating segments on a full period base, Q1/9-12-day-effect will be adjusted in O&C Martin Blessing CEO London 3 September / 1 October 29 4

42 Others & Consolidation in m Q1 28 Q2 28 H1 28 Q3 28 Q4 28 Q1 29 Q2 29 H1 29 Net interest income Provision for possible loan losses Net interest income after provisioning Net commission income Trading profit Net investment income Other result Revenue b efore LLP Revenue after LLP Operating expenses Operating profit Impairments of goodw ill 12 Restructuring expenses Pre-tax profit Average equity tied up -7,356-6,877-7,117-7,523-8, ,178 3,5 Operating return on equity (%) Cost/income ratio in operating business (%) Return on equity of pre-tax profit (%) Martin Blessing CEO London 3 September / 1 October 29 41

43 Group equity definitions Reconciliation of equity definitions Equity basis for RoE Equity definitions in m Jun 29 Jan - Jun 29 Subscribed capital 3,71 2,353 Capital reserve 7,945 7,44 Retained earnings 5,912 5,97 Silent participation SoFFin 17,178 9,473 Reserve from currency translation Investors Capital w ithout minorities 33,617 24,398 Basis for RoE on net profit Minority interests (IFRS)* Investors Capital 34,467 25,235 Basis for operating RoE and pre-tax RoE Change in consolidated companies; goodwill; consolidated net profit minus portion of dividend; others -5,61 Basel II core capital w ithout hybrid capital 29,46 Hybrid capital 4,4 Basel II Tier I capital 33,41 * excluding: - Revaluation reserve - Cash flow hedges - Consolidated profit Martin Blessing CEO London 3 September / 1 October 29 42

44 Appendix 3: ABS-Portfolio & Leveraged Acquisition Finance (LAF) Martin Blessing CEO London 3 September / 1 October 29 43

45 Charges on ABS Portfolio in H1 29 Overview - ABS portfolio As of 6/29 (in m) Secondary Market ABS* Nominal values 25,515 Market values 16,645 H1- Charges -1,44 P&L effect -1,137 Effect on revaluation reserve -33 Mark- down- Ratio*** 35% Details The H1 29 charges resulting from ABS portfolio are totalling 1.77bn; thereof 1.47bn as P&L effect and.3bn as effect on revaluation reserve. thereof critical portfolio 19,564 1,898-1,411-1, % Outlook thereof governm. guaranteed Conduits** thereof critical portfolio 5,734 9,472 3,59 5,587 9,472 3, % % % Due to further shift of financial market crisis to real economy and the weak fundamental situation more charges from ABS portfolio are expected for 29. thereof other conduits ABS Hedge book CIRC**** Others (incl. Term Struct.)** Total 5,882 14, ,488 5,882 1, , , , % 26% N/A 4% 25% Further charges are expected from US CDO of ABS, US RMBS, CMBS/CRE CDO, Non-US RMBS and Large Corp. CDOs as well as effects from weak Monoline counterparts concerning protected ABS assets. No significant losses expected with regard to conduit business. thereof critical portfolio 38,655 26,349-1,745-1, % thereof other ABS positions 11,833 11, % * includes former K2 assets, which were purchased by Commerzbank during June 29 due to orderly winddown of K2; also includes other ABS (H1-charges of - 48m) ** incl. transactions that do not fall under the SolvV-definition of ABS under regulatory aspects *** Markdown-Ratio = 1-(Market Value / Nominal Value) **** The nominal value solely refer to risk position of Commerzbank (second loss position) Martin Blessing CEO London 3 September / 1 October 29 44

46 CDA and Counterparty Risk from Monolines Development of Counterparty Default Adjustments* in m 99 CDA Total CDA-Monolines CDA-Other CDA Change (positive figure = loss) , , , , , ,651 Net Counterparty Risk from Monolines As of 6/29 in bn CDA in 29 YTD: 1,732-1, CDA ratio for Monoline positions at 56% compared to 47% at year end /25 12/26 12/27 12/28 * CDAs referring to monoline and non-monoline counterparties 3/29 6/29 MtM (Recovery costs) CDA Net Counterparty Risk Details MtM of derivatives is adjusted to the creditworthiness of counterparties. The fair value needs to be corrected through trading P&L by CDAs. Main driver of the CDA reduction in Q2 was the allowance for bad debts we took on the full exposure related to one Credit Derivative Product Company ( CDPC ) due to the potential default of this firm. The overall decline of CDAs in Q2 amounts to m. The major part is due to the CDA-Other category with m (driven by the CDPC write down and a general decrease in credit spreads) and - 99 m to CDA-Monolines category (driven by reduced MtM-exposure). Outlook The general outlook for the Monolines remains unimproved with CDS Spreads likely to be volatile over the foreseeable future. This might lead to changes in CDAs accordingly. There is also potential for defaults in this sector. Martin Blessing CEO London 3 September / 1 October 29 45

47 Secondary Market ABS Breakdown of products & rating distribution secondary market ABS As of 6/29 Market values in bn 16.6bn AAA AA A BBB BB&w orse 3% 7% 1% 14% 66% Details Government guaranteed ABS constitute the largest subasset class with market values stable at 6.2bn. Loss drivers: US CDO of ABS, US RMBS, CMBS/CRE CDO, Non-US RMBS and Large Corp. CDOs; markdown ratios of the most critical classes US CDO of ABS and US RMBS currently stand at 76% and 81% respectively. Outlook Further impact from US related positions expected for 29 due to unchanged weak economic fundamental situation; other segments will also contribute to this development (e.g. CMBS, Non-US RMBS and Large Corp. CDOs). (in m) Nominal values Market values H1-Charges P&L effect Effect on revaluation reserve Mark-down-ratio* Government guaranteed 6,33 6, % Consumer ABS 2,21 1, % CMBS/CRE CDO 2,55 1, % Large Corp. CDO 3,35 2, % RMBS/CDO 9,824 3, % thereof US RMBS 2, % thereof US CDO of ABS 3, % thereof Non-US RMBS/CDO 3,452 2, % SME CDO % Others % Total** 25,515 16,645-1,44-1, % * Markdown-Ratio = 1-(Market Value / Nominal Value); Markdown-Ratio on Secondary Market ABS excluding Government guaranteed ABS of 45% ** includes former K2 assets, which were purchased by Commerzbank during June 26 due to orderly winddown of K2 Martin Blessing CEO London 3 September / 1 October 29 46

48 Conduits Breakdown by products As of 6/29 Market values in bn AAA 24% Details Majority of exposure refers to own conduits Silvertower (57%) Beethoven (28%) and Kaiserplatz (12%). 3% refers to third party conduits. 9.5bn** AA A BBB BB&w orse 3% 13% 19% 4% Main part of exposure consist of liquidity back-up lines for these conduits (94%), with the remainder stemming from credit enhancement provided by CB group. Downsizing by 1.1bn since Q1 29, mainly due to reduction/termination of transactions of Beethoven. Outlook No significant losses expected with regard to conduit business. (in m) Nominal values Market values H1-Charges P&L effect Effect on revaluation reserve Mark-down-ratio* Trade Receivables 2,237 2,237 % Corporate Loans 2,517 2,517 % Auto Loans/Leases 1,546 1,546 % Film Receivables % Equipment Leasing % Capital Commitments % Div. Payment Rights % CRE CDO % CDO of ABS % Non-US RMBS % Consumer Loans % Total** 9,472 9,472 % * Markdown-Ratio = 1-(Market Value / Nominal Value) ** incl. transactions that do not fall under the SolvV-definition of ABS under regulatory aspects Martin Blessing CEO London 3 September / 1 October 29 47

49 ABS Hedge Book Monoline 1/2 Breakdown by asset and rating classes Rating distribution on the basis of market values in % Market values in bn AAA AA Details Positive P&L development in Q2 of + 179m as a result of declining CDAs. Overall H1-Charges sum up to - 292m. Year-to-date a slight release of CDA of + 79m recognized. 8.7bn A BBB BB BB Outlook Business model and creditworthiness of Monoline insurers furthermore doubtful. Further P&L effects as a result of Monoline defaults or restructuring possible in 29. (in m) Nominal values Market values H1-Charges P&L effect Effect on revaluation reserve Mark-down-Ratio* Monoline CMBS/CRE CDO % Large Corp. CDO 1, % RMBS/CDO 8,929 7, % thereof US RMBS % thereof US CDO of ABS 3,35 1, % thereof Non-US RMBS** 5,334 5, % Others % Total 1,838 8, % * Mark-down-Ratio = 1-(market value / nominal value); ** Consists exclusively of Triple A rated Super Senior positions of European RMBS transactions; Markdown-Ratio excluding Non-US RMBS of 38% Martin Blessing CEO London 3 September / 1 October 29 48

50 ABS Hedge Book Non-Monoline 2/2 Breakdown by asset and rating classes Rating distribution on the basis of market values in % Market values in bn AAA AA 2 34 Details Exposure stems from two TRS with a large financial institution. Overall market value scarcely changed at 1.9bn. 1.9bn A BBB BB 5 7 Outlook Only minor P&L effects expected as the structure as well as the creditworthiness of the counterparty is strong. BB 34 (in m) Nominal values Market values H1-Charges P&L effect Non-Monoline Effect on revaluation reserve Mark-down-Ratio* CMBS/CRE CDO % Large Corp. CDO 1,44 1,6 26% RMBS/CDO 1, % thereof US RMBS % thereof US CDO of ABS % thereof Non-US RMBS % Others % Total 3,35 1, % Total ABS Hedge Book 14,188 1, % * Mark-down-Ratio = 1-(market value / nominal value) Martin Blessing CEO London 3 September / 1 October 29 49

51 Charges on ABS Portfolio in H1 29 (Split by P&L-lines) Overview - ABS portfolio As of 6/29 (in m) Nominal values Market values P&L-Charges Provisions Trading Profit Net investment Income Others Secondary Market ABS* 25,515 16,645-1, thereof critical portfolio 19,564 1,898-1, thereof governm. guaranteed 5,734 5,587 Conduits** 9,472 9,472 thereof critical portfolio 3,59 3,59 thereof other conduits 5,882 5,882 ABS Hedge book 14,188 1, CIRC Others (incl. Term Struct.)** Total 5,488 37,978-1, , thereof critical portfolio 38,655 26,349-1, ,6-292 thereof other ABS positions 11,833 11, * includes former K2 assets, which were purchased by Commerzbank during June 29 due to orderly winddown of K2 ** incl. transactions that do not fall under the SolvV-definition of ABS under regulatory aspects Martin Blessing CEO London 3 September / 1 October 29 5

52 Charges on ABS Portfolio in H1 29 (Breakdown by Business segment) Overview - ABS portfolio As of 6/29 (in m) Nominal values Market values P&L- Charges PBC MSB CEE C&M CRE O&C Secondary Market ABS* 25,515 16,645-1, thereof critical portfolio 19,564 1,898-1, thereof governm. guaranteed 5,734 5,587 Conduits** 9,472 9,472 thereof critical portfolio 3,59 3,59 thereof other conduits 5,882 5,882 ABS Hedge book 14,188 1, CIRC Others (incl. Term Struct.)** Total 5,488 37,978-1, , thereof critical portfolio 38,655 26,349-1, , thereof other ABS positions 11,833 11, * includes former K2 assets, which were purchased by Commerzbank during June 29 due to orderly winddown of K2; also includes other ABS (P&L-charges of - 6m) ** incl. transactions that do not fall under the SolvV-definition of ABS under regulatory aspects Martin Blessing CEO London 3 September / 1 October 29 51

53 Leveraged Acquisition Finance (LAF) Overall portfolio with focus on Underwriting / Final Hold Portfolio As of June 29 Exposure at Default in bn LAF portfolio financing Leveraged- Loan-CIRCs Underwriting Final Hold Regions 46% 6% 4% Germany USA Italy 3% 5% 4.4bn France The Netherlands 17% UK 1% Luxemburg 9% Rest of Europe Portfolio details * In Q2 29 significant specific charges could be avoided in the final hold and underwriting book through active risk management and close customer contact. The reduction in volume in the underwriting and final hold book is substantially due to the transfer of transactions to the default portfolio (specific provisions were manly made per 12/28). In H1 29 several CIRCs were restructured / unwound without a loss. Volumes and risk could be reduced significantly as a result. Six transactions are still outstanding. The LAF portfolio financings suffer from defaults within the portfolios. No specific charges so far. Outlook Due to high gearing ratios of companies in the portfolio, they are especially vulnerable to a recession. In direct LAF business this can lead to further burdens on revenues due to specific provisions. Potential losses concerning CIRCs have been limited due to de-risking measures. For the portfolio financing, downratings, restructurings as well as losses from individual transactions cannot be excluded. * excluding default portfolio Martin Blessing CEO London 3 September / 1 October 29 52

54 Notes Martin Blessing CEO London 3 September / 1 October 29 53

55 For more information, please contact Commerzbank s IR team: Jürgen Ackermann (Head of IR) P: M: juergen.ackermann@commerzbank.com Wennemar von Bodelschwingh P: M: wennemar.vonbodelschwingh@commerzbank.com Stefan Philippi P: M: stefan.philippi@commerzbank.com Sandra Büschken (Deputy Head of IR) P: M: sandra.bueschken@commerzbank.com Michael H. Klein P: M: michael.klein@commerzbank.com Ute Heiserer-Jäckel P: M: ute.heiserer-jaeckel@commerzbank.com Simone Nuxoll P: M: simone.nuxoll@commerzbank.com Karsten Swoboda P: M: karsten.swoboda@commerzbank.com Martin Blessing CEO London 3 September / 1 October 29

56 Disclaimer investor relations This presentation has been prepared and issued by Commerzbank AG. This publication is intended for professional and institutional customers. Any information in this presentation is based on data obtained from sources considered to be reliable, but no representations or guarantees are made by Commerzbank Group with regard to the accuracy of the data. The opinions and estimates contained herein constitute our best judgement at this date and time, and are subject to change without notice. This presentation is for information purposes, it is not intended to be and should not be construed as an offer or solicitation to acquire, or dispose of any of the securities or issues mentioned in this presentation. Commerzbank AG and/or its subsidiaries and/or affiliates (herein described as Commerzbank Group) may use the information in this presentation prior to its publication to its customers. Commerzbank Group or its employees may also own or build positions or trade in any such securities, issues, and derivatives thereon and may also sell them whenever considered appropriate. Commerzbank Group may also provide banking or other advisory services to interested parties. Commerzbank Group accepts no responsibility or liability whatsoever for any expense, loss or damages arising out of, or in any way connected with, the use of all or any part of this presentation. Copies of this document are available upon request or can be downloaded from Martin Blessing CEO London 3 September / 1 October 29 55